utah construction company to our stockholders utah construction company is both an operating company and a holding company as an operating company it engages in general construction and mining principally in the united states the subsidiary and affiliated companies in which utah construction has invested are engaged principally in construction mining shipping and land development these companies extend the company s interests virtually around the world parent company earnings earnings of the parent company for the fiscal year 1957 were 2,732,484 or 1.53 a share outstanding this compares to 2,422,472 for the pre ceding year or 1.36 a share adjusted for the increase in the number of shares outstanding during 1957 resulting from the 100 stock dividend paid on may 15 1957 and the establishment of the employees stock purchase plan the improvement in earnings resulted from higher gross income from heavy construction and mining and larger dividend distri butions from subsidiary and affiliated companies construction earnings continued to be depressed by large losses on certain joint ventures in which your company is a participant particularly those engaged in con struction projects on the st lawrence seaway charged against current earnings in 1957 was depreciation amounting to 2,161,743 which was mainly computed on the declining balance method and included 566,362 more than would have been charged under the straight line method the increase in this charge due to use of accelerated depreciation methods in 1956 amounted to 786,029 also deducted from 1957 earnings was 643,587 which was credited to the reserve for future payments to the retirement plan based on profit sharing if company net profits continue to exceed the amount required to pay the maximum current contributions under the terms of the trust agreement a portion of the amounts credited to this reserve will be restored to earnings in future years subsidiary . mies for the fiscal year 1957 utah construction company's share of the current earnings of subsidiary and affiliated companies in which it has investments amounted to 2,6o9,471 of ter on a i lov^a nee for dividends paid and for taxes that would be payable upon distribution of the balance this is equivalent to 1.51 a share of utah construction company stock and compares with 1 755,71 1 or 99c a share for the preceding year adjusted for the increase in shares outstanding during the year from shipping and reported slightly low enjoyed a modest irn gs was primarily attributable to better profits i foreign construction subsidiaries generally nings while domestic construction subsidiaries overall results combining the parent company earnings and the company's share of the undistributed 1957 earnings of subsidiary and affiliated companies as reported above gives an overall profit for the year of 5,421,955 equiv alent to 3.05 a share of utah construction company stock outstanding this compares to 4,178,183 or an adjusted amount of 2.35 a share for the preceding year which had heretofore been the highest year in the history of the company in 1955 the overall gain reported by the company amounted to 3,404,424 and the successive new highs set in 1956 and again in 1957 must be attributed in part to the unusually large volume of work performed and the level of general business activity which favored both our construction and mining activities financial condition to sustain the large volume of company activities has necessitated the borrowing of 9,675,000 by the parent company and the conservation of its working capital by the payment of dividends in the form of common stock of permanente cement company working capital amounted to 6,048,563 on october 31 1957 compared to 2,293,027 a year earlier on may 15 1957 a 100 per cent stock dividend wos paid to shareholders of record at may 1 1957 which resulted in doubling the number of shares outstanding at the end of the previous fiscal year for each share so issued 2 was transferred from the earned surplus account to the capital stock account of the company additionally adjusting for the stock dividend the company distributed four quarterly dividends amounting to a total of 1/20 of a share of permanente cement company for each share held in utah construction company at the time of distribution these dividends paid in stock of permanente cement company had a total market value per share of utah stock held of 90c as compared with an adjusted amount of 72 per share paid during the previous year in the opinion of the management the company's assets are conservatively valued the stocks held in other companies are carried on the company's books at cost which is substantially below their real value net worth on october 31 1957 amounted to 24,380,723 or 13.69 a share compared to 21 108,555 or an adjusted amount of 1 1 86 a share at the close of the preceding year these figures are based on valuing our investments at cost rather than their indicated values which would have been 23,500,000 higher in 1957 as against 1 1,500,000 higher in 1956 the year ahead as this report is written there are indications of a possible decline in the volume of new heavy construction and perhaps general business as well residential construction has been declining since 1955 and capital expend itures anticipated far 1958 are well below levels of the preceding year tight money also appears to be affecting construction activity adversely naturally any change in general construction or business activity will ultimately affect your company the backlog of uncompleted work on hand declined during the year but is still substantial and sufficient to sustain a high degree of activity during the better part of 1958 our overall earnings will also be augmented by our interest in lucky me uranium corporation whose mill is scheduled to commence operations in the spring of 1958 all in all unless there is o sharp recession we anticipate that your company will continue to enjoy good earnings in the coming year the management tenders its sincere expression of appreciation to our clients for their confidence and to our many employees whose loyal and efficient services have contributed to another year of sound progress respectfully submitted allen d.christensen president qnd general manager